HomeMy WebLinkAboutContract 36633-A2 CITY SECRETARY
CONTRACT NO. 3°w\0 33
AMENDMENT NO. 2 TO
ECONOMIC DEVELOPMENT PROGRAM AGREEMENT
This AMENDMENT NO. 2 TO ECONOMIC DEVELOPMENT PROGRAM
AGREEMENT ("Amendment") is entered into by and between the CITY OF FORT
WORTH, TEXAS (the "City"), a home rule municipal corporation organized under the
laws of the State of Texas, and CARLYLE/CYPRESS WEST 7TH, LP ("Developer"),
a Delaware limited partnership.
RECITALS
The City and Developer hereby agree that the following statements are true and
correct and constitute the basis upon which the City and Developer have entered into
thisAmendment:
A. Developer owns or is under contract to purchase, or has control of design
and redevelopment rights on, approximately fifteen (15) acres of land in the City in the
vicinity of West 7th Street and University Drive (the "Development Property"), as more
specifically depicted and described in Exhibit "A", attached hereto and hereby made a
part of this Agreement for all purposes. The Development Property currently consists of
a mixture of vacant lots and buildings that, in most cases, are dilapidated.
B. Developer has caused and intends to continue to cause construction of a
mixed-use development on the Development Property in stages at three potential levels of
investment (the Level 1 Development, the Level 2 Development and the Level 3
Development), each of which is more specifically defined in Section 2 of this Agreement
(generally and collectively referred to hereafter as the "Development"). The proposed
Development is generally depicted in the schematic attached hereto as Exhibit "B",
which is hereby made a part of this Agreement for all purposes. Developer has
represented to the City that the Development will not be feasible financially without
public assistance due to, among other things, obsolete infrastructure on and around the
Development Property; the need for the construction of parking garages for the benefit of
the Development (and not for general public parking), which are necessary to achieve the
public purpose of making the Development more dense, consistent with
recommendations set forth in the Comprehensive Plan for mixed-use growth centers, as
outlined more specifically in Recital C hereof, the necessity of reconfiguring and/or
relocating existing utility facilities; the demolition of existing structures on the
Development Property; and various environmental issues.
C. The 2011 Comprehensive Plan, adopted by the City Counci rch 1,
2011 pursuant to Ordinance No. 19569-03-2011 (the "Comprehensive Pl q") defines a -CORD
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11 -2?
mixed-use growth center as a relatively small urbanized area that contains a concentration
of jobs, housing units, schools, parks and other public facilities, public transportation
hubs and pedestrian activities. Among the potential benefits of mixed-use growth centers
cited by the Comprehensive Plan are economic development; the development of
multifamily housing at appropriate locations; efficiency in the provision of public
facilities and services; reduced reliance upon single-occupancy vehicles; and the
protection of the environment. Accordingly, the Comprehensive Plan cites the promotion
of mixed-use growth center development patterns as a goal that the City should embrace.
The Comprehensive Plan identifies the cultural district area of the City as a regional
mixed-use growth center. In 2001 the City Council selected West 7th Street as one of
eight commercial corridors in the City where revitalization efforts were most needed and
where use of public incentives could most sensibly be focused.
D. As recommended by the Comprehensive Plan and in accordance with
Resolution No.3716-03-2009, adopted by the City Council on March 10, 2009, the City
has established an economic development program pursuant to which the City will, on a
case-by-case basis, offer economic incentive packages authorized by Chapter 380 of the
Texas Local Government Code that include monetary loans and grants of public money,
as well as the provision of personnel and services of the City, to businesses and entities
that the City Council determines will promote state or local economic development and
stimulate business and commercial activity in the City in return for verifiable
commitments from such businesses or entities to cause specific infrastructure,
employment and other public benefits to be made or invested in_ the City (the "380
Program").
E. The City and Developer previously entered into that certain Economic
Development Program Agreement dated as of February 15, 2008, a public document on
file in the City Secretary's Office as City Secretary Contract No. 36633, as amended by
that certain Amendment No. 1 to Economic Development Program Agreement dated as
of May 25, 2011, a public document on file in the City Secretary's Office as City
Secretary Contract No. 36633-Al (together with this Amendment, the "Agreement").
F. Due to economic, market and financing changes since the Agreement was
originally executed, on August 23, 2011 the City Council approved Mayor and Council
Communication C-25123 that approved execution of a second amendment to the
Agreement allowing for a change in scope of the Level 1 Development, the Level 2
Development and the Level 3 Development; an extension of the Completion Deadline for
the Level 2 Development and the Level 3 Development; and a revision in the manner in
which Program Grants are calculated, all as more specifically set forth in this Agreement.
Because of the complexity of these changes, the parties wish to enter into this
Amendment to restate all terms and conditions set forth in City Secretary Contract No.
36633-A1, as amended by City Secretary Contract No. 36633-A2.
G. The City Council has determined that by entering into this Agreement, the
potential economic benefits that will accrue to the City under the terms and conditions of
this Agreement are consistent with the City's economic development objectives and that
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Amendment No.2 to Economic Development Program Agreement
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promoting mixed-use development in the Central City will further the goals espoused by
the Comprehensive Plan for positive growth in the City. In addition, the City Council has
determined that the 380 Program is an appropriate means to achieve the construction of
the Development, which the City Council has determined is necessary and desirable, and
that the potential economic benefits that will accrue to the City pursuant the terms and
conditions of this Agreement are consistent with the City's economic development
objectives as outlined in the Comprehensive Plan. The Agreement, as amended by this
Amendment, is authorized by Chapter 380 of the Texas Local Government Code.
H. The City has determined that the feasibility of the Development is
contingent on Developer's receipt of the Program Grants, as provided in this Agreement.
The City's analysis is specifically based on financial information provided by Developer.
NOW, THEREFORE, in consideration of the mutual benefits and promises
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
AGREEMENT
I. INCORPORATION OF RECITA.T_.S.
The City Council has found, and the City and Developer hereby agree, that the
recitals set forth above are true and correct and form the basis upon which the parties
have entered into this Agreement. The Agreement set forth herein is a complete
restatement and amendment of City Secretary Contract No. 36633, as previously
amended by City Secretary Contract No. 36633-A1. Any conflict between the provisions
of the Agreement set forth herein, including any exhibits attached hereto, and the
provisions of either or both of City Secretary Contract No. 36633 and City Secretary
Contract No. 36633-A1, including any exhibits attached thereto, shall be resolved in
favor of the provisions set forth herein.
2. DEFINITIONS.
In addition to terms defined in the body of this Agreement, the following terms
shall have the definitions ascribed to them as follows:
380 Program has the meaning ascribed to it in Recital D.
Affiliate means (i) an entity to be formed by Developer to own the Development;
(ii) all entities, incorporated or otherwise, under common control with, controlled by or
controlling Developer; and (iii) all entities, incorporated or otherwise, under common
control with, controlled by or controlling Cypress Equities, LLC, a Texas limited liability
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Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
company, and/or Carlyle Retail I, LLC, a Delaware limited liability company, and/or
Carlyle/Cypress Retail I, L.P., a Delaware partnership. For purposes of this definition,
"control" means fifty percent (50%) or more of the ownership determined by either value
or vote.
Affordable Housing Commitment has the meaning ascribed to it in Section 4.7.
Affordable Housing Units has the meaning ascribed to it in Section 4.7.
Agreement has the meaning ascribed to it in Recital E.
Certificate of Completion has the meaning ascribed to it in Section 5.1.
Commercial means and includes retail, restaurant, theater, health club,
entertainment, and similar services.
Completion Deadline means the Level 1 Completion Deadline, Level 2
Completion Deadline or Level 3 Completion Deadline, depending on the context, and is a
general term used herein to refer to such various Completion Deadlines.
Comprehensive Plan has the meaning ascribed to it in Recital C.
Construction Costs means the aggregate of Hard Construction Costs, Tenant
Improvement Costs, and the following costs directly expended by Developer or by third
parties other than Developer for the Development: engineering fees; architectural and
design fees; real estate commissions; costs of third party consultants, including attorneys
and environmental consultants; developer fees; zoning fees; insurance and taxes directly
related to the construction of the Development; and financing costs, including capitalized
interest.
Development means the improvements constructed on the Levels of
Development Property, the entirety of which have certificates of occupancy, either
temporary or final, issued by the City as of the Completion Deadline for such Levels, and
which must, at a minimum, comprise the Level 1 Development and may, at Developer's
option, subsequently comprise the Level 2 Development or the Level 3 Development.
Development Personal Property Tax Revenues means ad valorem taxes on
Tangible Personal Property located on the Development Property that are received by the
City, minus $23,489.15, which amount equals the taxes payable on Tangible Personal
Property located on the Development Property for the 2007 tax year. With respect to
Tangible Personal Property leased by a Development Property User, Development
Personal Property Tax Revenues will include that portion of annual property tax paid by
the Development Property User, prorated on a daily basis, which is attributable to the
period during which the Development Property User was the lessee of such property.
The taxable appraised value of such Tangible Personal Property for any given tax year
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Amendment No.2 to Economic Development Program Agreement
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will be established solely by the appraisal district that has jurisdiction over the
Development Property at the time.
Development Property has the meaning ascribed to it in Recital A.
Development Property User means any person or entity that has the legal right
to use all or occupy any portion of the Development for Commercial, retail, residential or
other lawful purposes, including without limitation, Developer, its contractors and
subcontractors, and third party retail and commercial businesses.
Development Real Property Tax Revenues means ad valorem taxes on the
Development Property and any improvements located thereon, minus $118,230.23, which
amount equals the taxes payable on the Development Property and any improvements
located thereon for the 2007 tax year. The taxable appraised value of the Development
Property and any improvements located thereon for any given year will be established
solely by the appraisal district that has jurisdiction over the Development Property at the
time.
Development Sales Tax Revenues means revenues received by the City from the
one percent (1%) available City sales tax that is presently in effect pursuant to Texas Tax
Code §§ 321.101(a) and 321.103, resulting from sales taxes collected by Developer and
other Developer Property Users on Sales transacted on the Development Property.
Development Sales Tax Revenues specifically excludes all revenues from (i) the Crime
Control District Sales Tax imposed by the City pursuant to Texas Tax Code § 323.105
and Texas Local Government Code § 363.005, as may be amended, and (ii) the Transit
Authority Sales Tax paid to the City by the Fort Worth Transportation Authority pursuant
to City Secretary Contract No. 19689, as previously or subsequently amended or restated,
from the sales tax imposed by the Fort Worth Transportation Authority pursuant to Texas
Tax Code Chapter 322. If the City's sales tax rate is ever decreased to the extent that the
City receives available sales tax revenues based on less than a one percent (1%) sales tax,
then the meaning of Development Sales Tax Revenues shall automatically be adjusted to
equal that lesser percentage. If the City's sales tax rate is ever increased to the extent that
the City receives revenues from available sales tax pursuant to Texas Tax Code §§
321.101(a) and 321.103 and whose use is not controlled or regulated, in whole or in part,
by another governmental entity or authority or otherwise dedicated to a specific use by
the City, then Development Sales Tax Revenues shall be computed to reflect that
increased percentage.
Director means the director of the City's Housing and Economic Development
Department.
Effective Date has the meaning ascribed to it in Section 3.
Employment Goal has the meaning ascribed to it in Section 4.4.
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Amendment No. 2 to Economic Development Program Agreement
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First Operating Year means the first full calendar year following the year in
which the Level 1 Completion Deadline occurs.
Fort Worth Certified M/WBE Company means a minority or woman-owned
business that (i) has received certification as either a minority business enterprise (MBE),
a woman business enterprise (WBE) or a disadvantaged business enterprise (DBE) by the
North Texas Regional Certification Agency (NTRCA); (ii) has a principal business office
located within the corporate limits of the City; and (iii) from such principal business
office performs a function or provides a service useful or necessary for the Development
for which Developer is also seeking credit under this Agreement.
Fort Worth Company means a business that has a principal office located within
the corporate limits of the City that performs a commercially useful function and that
provides the services for which Developer is seeking credit under this Agreement.
Fort Worth Construction Commitment has the meaning ascribed to it in
Section 4.2.
Fort Worth Construction Percentage has the meaning ascribed to it in Section
5.2.1.2.
Fort Worth Supply and Service Percentage has the meaning ascribed to it in
Section 5.2.1.4.
Fort Worth Supply and Service Spending Commitment has the meaning
ascribed to it in Section 4.5.
Hard Construction Costs means the aggregate of the following costs expended
or caused to be expended by Developer for the Development: actual site development and
construction costs, contractor fees, and the costs of supplies and materials, but excludes
land acquisition costs paid by Developer for the various parcels that make up the
Development Property. Hard Construction Costs specifically excludes Tenant
Improvement Costs and any Construction Costs expended for the Development by third
parties other than Developer and its contractors and subcontractors.
HUD means the United States Department of Housing and Urban Development or
successor agency.
Job means a job provided to an individual by a Development Property User on
the Development Property.
Level means the Level 1 Development, the Level 2 Development, or the Level 3
Development, depending on the context, and is a general term used herein to refer to such
various levels of the Development.
Level 1 Completion Deadline means December 31, 2011.
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Amendment No.2 to Economic Development Program Agreement
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Level 1 Development means the expenditure of between $150,000,000.00 and
$165,000,000.00 in Construction Costs, as verified in the Certificate of Completion
issued by the City in accordance with Section 5.1, for construction on the Development
Property of, at a minimum, the following improvements: (i) at least 200,000 square feet
of Commercial space, the entirety of which must have a certificate of occupancy for shell
building space issued by the City, and (ii) Residential Units comprising at least 300,000
square feet, the entirety of which must have a temporary or final certificate of occupancy
issued by the City for residential operations.
Level 2 Completion Deadline means December 31, 2012.
Level 2 Development means the aggregate expenditure of between
$165,000,001.00 and $190,000,000.00 in Construction Costs, as verified in the
Certificate of Completion issued by the City in accordance with Section 5.1, for
construction on the Development Property of, at a minimum, the following
improvements: (i) at least 200,000 square feet of Commercial space, the entirety of which
must have a certificate of occupancy for shell building space issued by the City; (ii)
Residential Units comprising at least 380,000 square feet, the entirety of which must have
a temporary or final certificate of occupancy issued by the City for residential operations;
and (iii) at least 80,000 square feet of office space, the entirety of which must have a
temporary or final certificate of occupancy for shell building space issued by the City.
Level 3 Completion Deadline means December 31, 2013.
Level 3 Development means the aggregate expenditure $190,000,001.00 or more
in Construction Costs, as verified in the Certificate of Completion issued by the City in
accordance with Section 5.1, for construction on the Development Property of, at a
minimum, the following improvements: (i) at least 200,000 square feet of Commercial
space, the entirety of which must have a temporary or final certificate of occupancy for
shell building space issued by the City; (ii) Residential Units comprising at least 460,000
square feet, the entirety of which must have a temporary or final certificate of occupancy
issued by the City for residential operations; and (iii) at least 100,000 square feet of office
space, the entirety of which must have a temporary or final certificate of occupancy for
shell building space issued by the City.
M/WBE Construction Commitment has the meaning ascribed to it in Section
4.3.
M/WBE Construction Percentage has the meaning ascribed to it in Section
5.2.1.3.
M/WBE Supply and Service Percentage has the meaning ascribed to it in
Section 5.2.1.5.
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Amendment No.2 to Economic Development Program Agreement
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M/WBE Supply and Service Spending Commitment has the meaning ascribed
to it in Section 4.6.
Notice of Completion has the meaning ascribed to it in Section 4.8.2.2.
Overall Construction Percentage has the meaning ascribed to it in Section
5.2.1.1.
Program Cap means the maximum number of gross dollars comprising all
Program Grants that the City is required to pay Developer pursuant to this Agreement,
based on the Level of Development constructed on the Development Property, as
follows:
(a) If the Level 1 Development occurs by the Level 1 Completion Deadline,
as verified in the Certificate of Completion for that Level issued by the City in
accordance with Section 5.1, the Program Cap shall equal $25,280,000.00, gross.
(b) If the Level 2 Development occurs by the Level 2 Completion Deadline,
as verified in the Certificate of Completion for that Level issued by the City in
accordance with Section 5.1, the Program Cap shall be increased to equal
$28,210,000.00, gross.
(e) If the Level 3 Development occurs by the Level_ 3 Completion Deadline,
as verified in the Certificate of Completion for that Level issued by the City in
accordance with Section 5.1, the Program Cap shall be increased to equal
$31,280,000.00, gross.
Program Grants means the annual economic development grants paid by the
City to Developer in accordance with this Agreement and as part of the 380 Program.
Program Source Funds means an amount of City funds available for inclusion in
a Program Grant that is payable in a given Program Year, which shall equal to seventy
percent (70%) of the Development Real Property Tax Revenues, plus seventy percent
(70%) of the Development Personal Property Tax Revenues, plus seventy percent (70%)
of the Development Sales Tax Revenues which were received by the City during the
Twelve-Month Period ending in the same Program Year in which the Program Grant for
that Program Year is payable. Notwithstanding anything to the contrary herein, if the
Level 2 Development does not occur by the Level 2 Completion Deadline, the Program
Source Funds for all subsequent Program Grants payable hereunder shall be reduced to
equal sixty-five percent (65%) of the Development Real Property Tax Revenues, plus
sixty-five percent (65%) of the Development Personal Property Tax Revenues, plus sixty-
five percent (65%) of the Development Sales Tax Revenues which were received by the
City during the Twelve-Month Period ending in the same Program Year in which the
Program Grant for that Program Year is payable.
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Amendment No.2 to Economic Development Program Agreement
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Program Year means a calendar year in which the City is obligated pursuant to
this Agreement to pay Developer a Program Grant, beginning with the first full calendar
year following the Level 1 Completion Deadline (Program Year 1).
Records has the meaning ascribed to it in Section 4.9.
Residential Property Taxes means the amount of ad valorem taxes on all
Residential Units and condominiums on the Development Property that are owed to the
City for a given tax year.
Residential Units means residential rental apartments located anywhere on the
Development Property and shall not include residential condominiums.
Sales means all sales of merchandise (including gift and merchandise
certificates), services and other receipts whatsoever of all business conducted in, on or
from the Development Property, whether cash or credit, including mail, telephone,
telefax, telegraph, internet or catalogue orders received or filled at or from the
Development Property, deposits not refunded to purchasers, orders taken (although such
orders may be filled elsewhere), sales to employees, sales through vending machines or
other devices. Sales will not include (i) any sums collected and paid for any sales or
excise tax imposed by any duly constituted governmental authority, (ii) the exchange of
merchandise purchased on and returned to the Development Property, (iii) the amount of
returns to shippers and manufacturers or (iv) the Salle of any Development Property
User's fixtures.
Second Operating Year means the second full calendar year following the year
in which the Level 1 Completion Deadline occurs.
Supply and Service Expenditures means all expenditures by Developer, whether
pursuant to a written contract or on an ad hoc basis, expended directly for the operation
and maintenance of the Development, including amounts paid to third parties for the
provision of personnel services, but excluding amounts paid for electric, gas, water and
any other utility services.
Tangible Personal Property means personal property that is located on the
Development Property and is owned or leased by any Development Property User,
including, without limitation, inventory, fixtures, store signage, checkout stands,
computers, cash registers and security and communications systems.
Tenant Improvement Costs means all costs associated with the design,
construction, and fixturization within a tenant's premises, including, but not limited to,
architectural, contractor, and design fees, building materials and work on a tenant's
behalf, and other work performed within the tenant's premises along with the tenant's
permanent fixtures.
Term has the meaning ascribed to it in Section 3.
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Amendment No. 2 to Economic Development Program Agreement
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Twelve-Month Period means the period between February 1 of a given year and
January 31 of the following year.
3. TERM.
This Agreement was effective as of February 15, 2008 (the "Effective Date"),
which was the Effective Date of City Secretary Contract No. 36633, and shall expire on
the earlier of (i) the date as of which the City has paid all Program Grants required
hereunder or (ii) the date as of which the amount of aggregate Program Grants paid by
the City equals the applicable Program Cap (the "Term").
4. DEVELOPER OBLIGATIONS, GOALS AND COMMITMENTS.
4.1. Real Property Improvements.
In accordance with the terms and conditions of this Agreement, by the
Level 1 Completion Deadline Developer shall have achieved, at a minimum, the
Level 1 Development.
4.2. Construction Spending Commitment for Fort Worth Companies.
Developer hereby agrees to make the following minimum expenditures in
Hard Construction Costs with Fort Worth Companies for each Level of the
Development (the "Fort Worth Construction Commitment"), as follows:
4.2.1. For Level 1.
By the Level 1 Completion Deadline, Developer shall have
expended or caused to be expended the greater of(i) $22 million in Hard
Construction Costs for the Level 1 Development or (ii) thirty percent
(30%) of all Hard Construction Costs for the Level 1 Development,
regardless of the total amount of such Hard Construction Costs, with Fort
Worth Companies.
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Amendment No.2 to Economic Development Program Agreement
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4.2.2. For Level 2.
If the Level 2 Development occurs by the Level 2 Development
Deadline, as verified in the Certificate of Completion for that Level issued
by the City pursuant to Section 5.1, the Fort Worth Construction
Commitment shall increase, as follows: By the Level 2 Completion
Deadline, Developer shall have expended or caused to be expended the
greater of (i) $22 million in Hard Construction Costs for the Level 1
Development or (ii) thirty percent (30%) of the sum of all Hard
Construction Costs for the Level 1 Development and the Level 2
Development, regardless of the total amount of such Hard Construction
Costs, with Fort Worth Companies.
4.2.3. For Level 3.
If the Level 3 Development occurs by the Level 3 Development
Deadline, as verified in the Certificate of Completion for that Level issued
by the City pursuant to Section 5.1, the Fort Worth Construction
Commitment shall increase, as follows: By the Level 2 Completion
Deadline, Developer shall have expended or caused to be expended the
greater of (i) $22 million in Hard Construction Costs for the Level 1
Development or (ii) thirty percent (30%) of the sum of all Hard
Construction Costs for the Level 1 Development, the Level 2
Development, and the Level 3 Development, regardless of such Hard
Construction Costs, with Fort Worth Companies.
4.3. Construction Spending Commitment for Fort Worth Certified
M/WBE Companies.
Developer hereby agrees to make the following minimum
expenditures in Hard Construction Costs with Fort Worth Certified
M/WBE Companies for each Level of the Development (the "M/WBE
Construction Commitment"). Dollars spent with Fort Worth Certified
M/WBE Companies shall also count as dollars spent with Fort Worth
Companies for purposes of the Fort Worth Construction Commitment
outlined in Section 4.2.
4.3.1. For Level 1.
By the Level 1 Completion Deadline, Developer shall have
expended or caused to be expended the greater of(i) $18 million in
Hard Construction Costs for the Level 1 Development or (ii)
twenty-five percent (25%) of all Hard Construction Costs for the
Level 1 Development, regardless of the total amount of such Hard
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Amendment No. 2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities 1,L.P.(CSC No.36633)
Construction Costs, with Fort Worth Certified M/WBE
Companies.
4.2.2. For Level 2.
If the Level 2 Development occurs by the Level 2
Development Deadline, as verified in the Certificate of Completion
for that Level issued by the City pursuant to Section 5.1, the
M/WBE Construction Commitment shall increase, as follows: By
the Level 2 Completion Deadline, Developer shall have expended
or caused to be expended the greater of (i) $18 million in Hard
Construction Costs for the Level 1 Development or (ii) twenty-five
percent (25%) of the sum of all Hard Construction Costs for the
Level 1 Development and the Level 2 Development, regardless of
the total amount of such Hard Construction Costs, with Fort Worth
Certified M/WBE Companies.
4.2.3. For Level 3.
If the Level 3 Development occurs by the Level 3
Development Deadline, as verified in the Certificate of Completion
for that Level issued by the City pursuant to Section 5.1, the
M/WBE Construction Commitment shall increase, as follows: By
the Level 3 Completion Deadline, Developer shall have expended
or caused to be expended the greater of (i) $18 million in Hard
Construction Costs for the Level 1 Development or (ii) twenty-five
percent (25%) of the sum of all Hard Construction Costs for the
Level 1 Development, the Level 2 Development, and the Level 3
Development, regardless of the total amount of such Hard
Construction Costs, with Fort Worth Certified M/WBE
Companies.
4.4. Employment Goal.
From and after the Level 1 Completion Deadline, Developer will use
commercially reasonable efforts to cause at least five (5) Jobs to be provided on
the Development Property (the "Employment Goal").
4.5. Supply and Service Spending Commitments for Fort Worth
Companies.
In the Second Operating Year and each calendar year thereafter,
Developer and Development Property Users, in the aggregate, shall spend at least
$100,000.00 in annual Supply and Service Expenditures with Fort Worth
Companies (the "Fort Worth Supply and Service Spending Commitment").
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Amendment No.2 to Economic Development Program Agreement
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4.6. Supply and Service Spending Commitment for Fort Worth Certified
M/WBE Companies.
In the Second Operating Year and each calendar year thereafter,
Developer and Development Property Users, in the aggregate, shall spend at least
$75,000.00 in annual Supply and Service expenditures with Fort Worth Certified
M/WBE Companies (the "M/WBE Supply and Service Spending
Commitment"). Dollars spent with Fort Worth Certified M/WBE Companies
shall also count as dollars spent with Fort Worth Companies for purposes of the
Fort Worth Supply and Service Spending Commitment outlined in Section 4.5.
4.7. Affordable Housing Set-Aside.
From and at all times after the Level 1 Completion Deadline, at least
fifteen percent (15%) of the Residential Units, regardless of the total number of
such Residential Units and regardless of the owner of record of any such
Residential Units (the "Affordable Housing Units"), shall be set aside for lease
as quality affordable housing in accordance with the provisions of this Section
4.7. At least one-third (1/3) of all Affordable Housing Units will be set aside
exclusively for lease to qualifying households whose adjusted incomes do not
exceed HUD's then-current sixty percent (60%) income limits for the Fort Worth-
Arlington, TX HUD Metro EMR Area at rents that do not exceed thirty percent
(30%) of such adjusted incomes. The remainder of the Affordable Housing Units
will be set aside exclusively for lease to qualifying households whose adjusted
incomes do not exceed HUD's then-current eighty percent (80%) income limits
for the Fort Worth-Arlington, TX HUD Metro EMR Area at rents that do not
exceed thirty percent (30%) of such adjusted incomes (all of the preceding in this
Section 4.7, the "Affordable Housing Commitment"). Developer will
cooperate with the City's Housing Department in reasonably publicizing the
availability of the Affordable Housing Units. For Developer's reference, HUD's
60% income limits and 80% income limits for the Fort Worth, TX HUD Metro
FMR area and an example of the calculation of rent limits based on those income
limits are attached hereto as Exhibit "C" and are published annually by HUD
(see www.hud.gov and www.huduser.org).
4.8. Reports and Filings.
4.8.1. Plan for Use of Fort Worth Certified NMBE Companies.
Prior to the submission of an application by or on behalf of
Developer for a permit from the City to initiate any work on a Level of the
Development (including demolition work), whichever is earlier,
Developer will file a plan with the Director as to how Developer intends to
meet the M/WBE Construction Commitment and the M/WBE Supply and
Service Spending Commitment applicable to that Level. Developer agrees
to meet with the City's M/WBE Office and Minority and Women
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Business Enterprise Advisory Committee as reasonably necessary for
assistance in implementing such plan and to address any concerns that the
City may have with such plan.
4.8.2. Construction Spending Reports.
4.8.2.1. Monthly Reports.
From the Effective Date until the Level 3
Completion Deadline, in order to enable the City to assist
Developer in meeting the M/WBE Construction Commitment,
Developer will provide the Director with a monthly report in a
form reasonably acceptable to the City that specifically outlines the
then-current aggregate Hard Construction Costs expended by and
on behalf of Developer for the Development as well as the then-
current aggregate Hard Construction Costs expended by and on
behalf of Developer for a Level of the Development with Fort
Worth Certified M/WBE Companies. Developer agrees to meet
with the City's M/WBE Office and Minority and Women Business
Enterprise Advisory Committee as reasonably necessary for
assistance in meeting or exceeding the M/WBE Construction
Commitment and to address any related concerns that the City may
have.
4.8.2.2. Notices of Completion and Final Construction
Reports.
When Developer believes that a Level of the
Development has occurred, Developer shall provide a written
notice to the City (a "Notice of Completion"). A Notice of
Completion must be filed with the City on or before the
Completion Deadline for the Level of Development covered by the
Notice. The purpose of a Notice of Completion is to allow the City
(i) to assess whether Developer achieved the Level of
Development claimed; (ii) to assess the extent to which Developer
met the Fort Worth Construction Commitment and the M/WBE
Construction Commitment applicable such Level, and (iii) to
establish the amount of the Program Cap under this Agreement.
Each Notice of Completion will include a final construction report
in a form reasonably acceptable to the Director that specifically
outlines the total Construction Costs and Hard Construction Costs
expended for improvements constructed as part of such Level,
together with supporting invoices and other documents necessary
to demonstrate that such amounts were actually paid, including,
without limitation, final lien waivers signed by Developer's
general contractor. This report shall also include actual total
Page 14
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities 1,L.P.(CSC No. 36633)
Construction Costs and Hard Construction Costs expended by
Developer for construction of the improvements comprising such
Level with Fort Worth Companies and Fort Worth Certified
M/WBE Companies, together with supporting invoices and other
documents necessary to demonstrate that such amounts were
actually paid by Developer to such contractors. Commercial
improvements constructed on the Development Property that do
not have certificates of occupancy for shell building space and
Residential Units constructed on the Development Property that
do not have certificates of occupancy for residential operations,
whether temporary or final(in both cases,for the entirety of such
improvements as of the date of a Notice of Completion), and any
Construction Costs and Hard Construction Costs expended for
such improvements, shall not be considered for purposes of
determining whether the Level of Development has been
achieved or assessing the extent to which Developer met the Fort
Worth Construction Commitment or the MIWBE Construction
Commitment applicable to such Level, provided, however, that
Commercial improvements constructed on the Development
Property that do not have certificates of occupancy for shell
building space and Residential Units constructed on the
Development Property that do not have certificates of occupancy
for residential operations, whether temporary or final (in both
cases,for the entirety of such improvements as of the date of a
Notice of Completion) shall,for purposes of this Agreement, be
deemed to have certificates of occupancy so long as applications
for certificates of occupancy for the entirety of such
improvements were properly filed with the City at least two (2)
weeks prior to the Notice of Completion (and complete copies of
such applications are included with the Notice of Completion),
and the City has not responded to such applications as of the date
of the Notice of Completion. In addition, Developer shall have
the right to file supplemental construction reports for a
particular Level of Development claimed at any time prior to the
Completion Deadline for that Level.
4.8.3. Annual Employment Report.
On or before February 1 of the year following the Level 1
Completion Deadline (the First Operating Year) and of each year
thereafter, in order for the City to assess the degree to which Developer
met the Employment Goal in the previous calendar year, Developer shall
provide the Director with a report in a form reasonably acceptable to the
City that sets forth the total number of individuals who held Jobs on the
Development Property as of December 1 (or such other date requested by
Developer and reasonably acceptable to the City) of the previous year,
Page ]5
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
together with reasonable supporting documentation. If Developer failed to
meet the Employment Goal in the previous calendar year, Developer shall
include an explanation as to why Developer believes it did not meet the
Employment Goal and the efforts that Developer utilized to meet the
Employment Goal.
4.8.4. Quarterly Supply and Service Spending Report.
Beginning with the first calendar quarter of the Second Operating
Year, within thirty (30) calendar days following the end of each calendar
quarter, Developer will provide the Director with a report in a form
reasonably acceptable to the City that sets forth the then-aggregate Supply
and Service Expenditures made during such calendar as well as the then-
aggregate Supply and Service Expenditures made during such calendar
year with Fort Worth Companies and with Fort Worth Certified M/WBE
Companies. The City will use each year's fourth quarter report to assess
the degree to which Developer met the Fort Worth Supply and Service
Spending Commitment and the M/WBE Supply and Service Spending
Commitment for that year.
4.8.5. Annual Affordable Housing Report.
On or before February 1 of the year following the Level 1
Completion Deadline (the First Operating Year) and of each year
thereafter, in order for the City to assess the degree to which Developer
met the Affordable Housing Commitment in the previous calendar year,
Developer shall provide the Director with a report in a form reasonably
acceptable to the City that sets forth (i) the total number of Residential
Units on the Development Property; (ii) the total number of Affordable
Housing Units; (iii) the number of Residential Units that were under lease
at any time during the previous calendar year; (iv) the number of
Affordable Housing Units that were under lease at any time during the
previous calendar year; and (v) for each Affordable Housing Unit that was
under lease at any time during the previous calendar year, sufficient
documentation for the City to assess the adjusted income of the tenant
leasing such Affordable Housing Unit and the amount of monthly rent
paid by that tenant.
4.9. Audits.
The City will have the right throughout the Term to audit the financial and
business records of Developer that are necessary to evaluate Developer's
compliance with this Agreement or with the commitments set forth in this
Agreement, including, but not limited to construction documents and invoices
(collectively "Records"). Developer shall make all Records available to the City
at Developer's offices in the City or at another location in the City acceptable to
Page 16
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
both parties following reasonable advance notice by the City and shall otherwise
cooperate fully with the City during any audit. After issuance of the Certificate of
Completion in accordance with Section 5.1, the City will not request a review and
audit of the Records more than once in any calendar year.
5. CITY OBLIGATIONS.
5.1. Issuance of Certificate of Completion for Levels of Development.
Within sixty (60) calendar days following receipt by the City of a Notice
of Completion issued by Developer in accordance with Section 4.8.2.2, and
assessment by the City of the information contained therein, including the final
construction report for the Level of the Development in question, if the City is
able to verify that, at a minimum, the Level of Development claimed by
Developer occurred on or before the Completion Deadline for that Level, the
Director will issue Developer a certificate stating that the Level of the
Development claimed by Developer was actually achieved, the amount of
Construction Costs and Hard Construction Costs expended on that Level of the
Development, including amounts expended specifically with Fort Worth
Companies and Fort Worth Certified M/WBE Companies, plus the amount of the
Program Cap established under this Agreement based on the Level of the
Development that Developer achieved (each a "Certificate of Completion").
Notwithstanding anything to the contrary herein, improvements constructed on
the Development Property that do not have certificates of occupancy, whether
temporary or final, for the entirety of such improvements as of the date of a
Notice of Completion, and any Construction Costs and Hard Construction
Costs expended for such improvements, shall not be considered for purposes of
determining whether the Level of Development has been achieved or assessing
the extent to which Developer met the Fort Worth Construction Commitment or
the M/WBE Construction Commitment for such Level;provided, however, that
improvements constructed on the Development Property that do not have
certificates of occupancy, whether temporary or final,for the entirety of such
improvements as of the date of a Notice of Completion shall,for purposes of
this Agreement, be deemed to have certificates of occupancy so long as
applications for certificates of occupancy for the entirety of such improvements
were properly filed with the City at least two (2) weeks prior to the date of the
Notice of Completion (and complete copies of such applications are included
with the Notice of Completion), and the City has not responded to such
applications as of the date of the Notice of Completion.
In the event that the City determines, after receipt of a Notice of
Completion and assessment of the final construction reports included therein, that
the Level of Development claimed by Developer has not occurred, the City shall
notify Developer in writing, in which case Developer may file supplemental
construction reports in accordance with Section 4.8.2.2 for the City's
Page 17
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
consideration at any time prior to the later of(i) the Completion Deadline for the
Level in question or (ii) thirty (30) calendar days following notification by the
City in accordance with this paragraph that the Level of Development claimed by
Developer has not occurred (provided that such supplemental construction reports
will be considered only for Construction Costs expended on or prior to the
Completion Deadline applicable to the Level in question), and the City will
reassess whether Developer subsequently has achieved the Level of Development
claimed. So long as the City is able to verify that, on the basis of the Notice of
Completion and all associated construction reports filed hereunder, that the Level
of Development claimed by Developer occurred on or before the Completion
Deadline for that Level, the City will issue a Certificate of Completion for that
Level in accordance with this Section 5.1.
5.2. Program Grants.
Subject the terms and conditions of this Agreement, provided that the
Level 1 Development occurred by the Level 1 Completion Deadline, Developer
will be entitled to receive from the City fifteen (15) annual Program Grants,
subject to the applicable Program Cap. The amount of each Program Grant shall
equal a percentage of the Program Source Funds, as more specifically set forth
herein. This percentage is based on the extent to which Developer met the
various construction and operational expenditures for the Level of Development
at the time, as more specifically set forth in Section 5.2.1. Program Grants may
be reduced or suspended if (i) Developer fails in any given year to meet the
Affordable Housing Commitment, as more specifically set forth in Section 4.7, or
(ii) the Level 2 Development does not occur by the Level 2 Completion Deadline.
Notwithstanding anything to the contrary herein, aggregate Program Grants
payable under this Agreement shall be subject to and shall not exceed the
applicable Program Cap, which amount is subject to increase as more specifically
explained in Section 5.2.4.
5.2.1. Calculation of Each Program Grant Amount.
Subject to the terms and conditions of this Agreement, the amount
of a given Program Grant shall equal the sum of the Overall Construction
Percentage, the applicable Fort Worth Construction Percentage and the
applicable M/WBE Construction Percentage, as defined in Section 5.2.1.1,
5.2.1.2 and 5.2.1.3, respectively, plus, to the extent applicable, the Fort
Worth Supply and Service Percentage and the M/WBE Supply and
Service Percentage, as defined in Sections 5.2.1.4 and 5.2.1.5,
respectively, multiplied by the Program Source Funds available for that
Program Grant. 1f the Level 2 Development does not occur by the Level
2 Completion Deadline, the amount of Program Source Funds for all
subsequent Program Grants payable hereunder shall be reduced, as more
specifically set forth in the definition provided in Section 2 for the term
"Program Source Funds."
Page 18
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No. 36633)
5.2.1.1. Completion of Development (50%).
Each annual Program Grant shall include an amount
that is based on Developer's completion of Level 1 of the
Development. If, at a minimum, the Level 1 Development
occurred by the Level 1 Completion Deadline, as confirmed by the
City in the Certificate of Completion issued for Level 1 by the
Director in accordance with Section 5.1, each annual Program
Grant shall include fifty percent (50%) of the Program Source
Funds (the "Overall Construction Percentage"). In no event will
the Overall Construction Percentage exceed fifty percent (50%).
Notwithstanding anything to the contrary herein, if the Level 1
Development did not occur by the Level 1 Completion Deadline,
an Event of Default, as more specifically set forth in Section 6.1,
will occur and the City shall have the right to terminate this
Agreement without the obligation to pay Developer any Program
Grants hereunder.
5.2.1.2. Fort Worth Construction Cost SpendinE (Up to
25% for Program Year 1; Up to 20%
Thereafter).
Each annual Program Grant shall include an amount
that is based on the percentage by which the Fort Worth
Construction Commitment, as outlined in Section 4.2, was met (the
"Fort Worth Construction Percentage"). In accordance with
Sections 4.2.2 and 4.2.3, the Fort Worth Construction Commitment
will change if the Level 2 Development occurred by the Level 2
Completion Deadline and the Level 3 Development occurred by
the Level 3 Completion Deadline, as verified in the Certificates of
Completion issued for such Levels pursuant to Section 5.1.
Accordingly, in such cases, the Fort Worth Construction
Percentage will be recalculated. The Fort Worth Construction
Percentage for the Program Grant payable in Program Year 1 will
equal the product of twenty-five percent (25%) multiplied by the
percentage by which the applicable Fort Worth Construction
Commitment was met, which will be calculated by dividing the
actual Hard Construction Costs expended with Fort Worth
Companies by the Completion Deadlines for the applicable Levels
of Development by the number of dollars comprising the Fort
Worth Construction Commitment, as determined in accordance
with Section 4.2. The Fort Worth Construction Percentage for all
subsequent Program Grants will equal the product of twenty
percent (20%) multiplied by the percentage by which the Fort
Worth Construction Commitment was met, calculated in
Page 19
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No. 36633)
accordance with the preceding sentence. For example (and not as a
commitment or goal), if the Fort Worth Construction Commitment
at a given time is $40,000,000.00 and only $32,000,000.00 in Hard
Construction Costs were expended with Fort Worth Companies by
the Completion Deadline for the Level of Development achieved
by such time, the Fort Worth Construction Percentage for the
Program Grant payable in Program Year 1 would be 20% instead
of 25% (or .25 x [$32 million/$40 million], or .25 x .80, or .20),
and the Fort Worth Construction Percentage for all subsequent
Program Grants would be 16% instead of 20% (or .20 x [$32
million/$40 million], or .20 x .80, or .16). If the applicable Fort
Worth Construction Commitment is met or exceeded, the Fort
Worth Construction Percentage will be twenty-five percent (25%)
for the Program Grant payable in Program Year 1 and twenty
percent (20%) for all subsequent Program Grants. In no event will
the Fort Worth Construction Percentage exceed those percentages
for the respective Program Year in which a Program Grant is
payable. Any subsequent reduction in the Fort Worth Construction
Percentage pursuant to this Section 5.2.1.2 will apply only to
future Program Grants payable hereunder.
5.2.1.3. Fort Worth M/WBE Construction Cost
Spending (Up to 25% for Program Year 15 Up to
20% Thereafter).
Each annual Program Grant shall include an amount
that is based on the percentage by which the M/WBE Construction
Commitment, as outlined in Section 4.3, was met (the "MIWBE
Construction Percentage"). In accordance with Sections 4.3.2
and 4.3.3, the M/WBE Construction Commitment will change if
the Level 2 Development occurred by the Level 2 Completion
Deadline and the Level 3 Development occurred by the Level 3
Completion Deadline, as verified in the Certificates of Completion
issued for such Levels pursuant to Section 5.1. Accordingly, in
such cases, the M/WBE Construction Percentage will be
recalculated. The M/WBE Construction Percentage for the
Program Grant payable in Program Year 1 will equal the product
of twenty-five percent (25%) multiplied by the percentage by
which the applicable M/WBE Construction Commitment was met,
which will be calculated by dividing the actual Hard Construction
Costs expended with Fort Worth Certified M/WBE Companies by
the Completion Deadline for the Levels of Development in
question by the number of dollars comprising the M/WBE
Construction Commitment, as determined in accordance with
Section 4.3. The M/WBE Construction Percentage for all
subsequent Program Grants will equal the product of twenty
Page 20
Amendment No. 2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
percent (20%) multiplied by the percentage by which the M/WBE
Construction Commitment was met, calculated in accordance with
the preceding sentence. For example (and not as a commitment or
goal), if the M/WBE Construction Commitment at a given time is
$32,000,000.00 and only $24,000,000.00 in Hard Construction
Costs were expended with Fort Worth Certified M/WBE
Companies by the Completion Deadlines for the applicable Levels
of Development achieved by such time, the M/WBE Construction
Percentage for the Program Grant payable in Program Year 1
would be 18.75% instead of 25% (or .25 x [$24 million/$32
million], or .25 x .75, or .1875), and the M/WBE Construction
Percentage for all subsequent Program Grants would be 15%
instead of 20% (or .15 x [$24 million/$32 million], or .20 x .75, or
.15). If the applicable.M/WBE Construction Commitment is met
or exceeded, the M/WBE Construction Percentage will be twenty-
five percent (25%) for the Program Grant payable in Program Year
1 and twenty percent (20%) for all subsequent Program Grants.
Any subsequent reduction in the M/WBE Construction Percentage
pursuant to this Section 5.2.1.3 will apply only to future Program
Grants payable hereunder.
5.2.1.4. Fort Worth Supply and Service Spending (Up to
5% after Program Year 1).
Except for the Program Grant payable in Program
Year 1, each annual Program Grant shall include an amount that is
based on the percentage by which the Fort Worth Supply and
Service Spending Commitment, as outlined in Section 4.5, was met
(the "Fort Worth Supply and Service Percentage"). The Fort
Worth Supply and Service Percentage will equal the product of
five percent (5%) multiplied by the percentage by which the Fort
Worth Supply and Service Spending Commitment was met, which
will be calculated by dividing the actual Supply and Service
Expenditures made in the previous calendar year with Fort Worth
Companies by $100,000.00, which is the Fort Worth Supply and
Service Spending Commitment. For example (and not as a
commitment or goal), if only $90,000.00 in Supply and Service
Expenditures were made with Fort Worth Companies in the
previous calendar year, the Fort Worth Supply and Service
Percentage for the Program Grant payable in the following
Program Year (other than Program Year 1) would be 4.5% instead
of 5% (or .05 x [$90,000/$100,000], or .05 x .90, or .045). If the
Fort Worth Supply and Service Spending Commitment is met or
exceeded in any given year, the Fort Worth Supply and Service
Percentage for the Program Grant payable in the following
Program Year will be five percent (5%). Calculation of the
Page 21
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No. 36633)
Program Grant payable for Program Year 1 does not include the
Fort Worth Supply and Service Percentage because the Fort Worth
Supply and Service Commitment does not apply to the First
Operating Year.
5.2.1.5. Fort Worth M/WBE Supply and Service
Spending (Up to 5% after Program Year 1).
Except for the Program Grant payable in Program
Year 1, each annual Program Grant shall include an amount that is
based on the percentage by which the M/WBE Supply and Service
Spending Commitment, as outlined in Section 4.6, was met (the
"M/WBE Supply and Service Percentage"). The M/WBE
Supply and Service Percentage will equal the product of five
percent (5%) multiplied by the percentage by which the M/WBE
Supply and Service Spending Commitment was met, which will be
calculated by dividing the actual Supply and Service Expenditures
made in the previous calendar year with Fort Worth Certified
M/WBE Companies by $75,000.00, which is the M/WBE Supply
and Service Spending Commitment. For example (and not as a
commitment or goal), if only $60,000.00 in Supply and Service
Expenditures were made with Fort Worth Certified M/WBE
Companies in the previous calendar year, the M/WBE Supply and
Service Percentage for the Program Grant payable in the following
Program Year (other than Program Year 1) would be 4% instead of
5% (or .05 x [$60,000/$75,000], or .05 x .80, or .04). If the
M/WBE Supply and Service Spending Commitment is met or
exceeded in any given year, the M/WBE Supply and Service
Percentage for the Program Grant payable in the following
Program Year will be five percent (5%). Calculation of the
Program Grant payable for Program Year 1 does not include the
M/WBE Supply and Service Percentage because the M/WBE
Supply and Service Commitment does not apply to the First
Operating Year.
5.2.1.6. No Offsets.
A deficiency in attainment of one commitment may
not be offset by the exceeding attainment in another commitment.
For example, if in a given year Developer failed to meet the
M/WBE Supply and Service Spending Commitment by $5,000.00,
but exceeded the Fort Worth Supply and Service Spending
Commitment by $5,000.00, all Program Grants payable in the
following year would still be reduced in accordance with Section
5.2.1.5 on account of Developer's failure to meet the M/WBE
Supply and Service Spending Commitment,
Page 22
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
5.2.2. Reductions to or Forfeiture of Program Grants for Failure to
Comply with Affordable Housing Commitment.
If the City determines that Developer has not complied with or is
not in compliance with the Affordable Housing Commitment, as outlined
in Section 4.7, the City will notify Developer in writing. If Developer
disagrees with the City's determination, Developer shall have fourteen
(14) calendar days to provide the City with documentation to rebut such
determination. If Developer does not provide the City with documentation
sufficient to rebut the City's determination within such time, the City's
determination shall be deemed conclusive. In this event, notwithstanding
anything to the contrary herein, (i) if the Affordable Housing Commitment
was not met for an entire calendar year, Developer shall forfeit payment of
the full amount of the Program Grant payable in the following year, and
(ii) if the Affordable Housing Commitment was not met for a portion of a
calendar year, then the amount of the Program Grant payable in the
following Program Year (as calculated in accordance with Section 5.2)
shall be reduced by a fraction, to be expressed as a percentage, where the
numerator is the number of days in that calendar year in which the
Affordable Housing Commitment was met and the denominator is 365.
Any Program Grant that is forfeited in a given Program Year pursuant to
this Section 5.2.2 shall nevertheless count as one of the fifteen (15) annual
Program Grants paid in accordance with this Section 5.2.
5.2.3. Reductions to Program Grants for Condominium Conversion
of Residential Units.
Developer understands and agrees that full Program Grants are
payable under this Agreement only to the extent that all Residential Units
are exclusively rental apartments and not condominiums.
Notwithstanding anything to the contrary herein (but subject to the last
sentence of this Section 5.2.3), if any Residential Units are converted to
condominiums, for the remainder of the Term each Program Grant
payable in accordance with this Agreement shall be reduced by an amount
equal to all Residential Property Taxes owed for the previous tax year, but
the amount of any such reduction shall nevertheless be included in
calculating the Program Cap. For example, if one-third (1/3) of the
Residential Units are converted to condominiums in 2015, the Program
Grant otherwise payable in 2016 shall be reduced by an amount equal to
all Residential Property Taxes owed for the 2015 tax year. Therefore, by
way of example only, if the Residential Property Taxes owed for the 2015
tax year equals $500,000.00, and the Program Grant otherwise payable in
2016 would have been $3 million, the actual Program Grant payable in
2016 would be $2.5 million, but for purposes of calculating the Program
Cap, the City will be credited for having made a Program Grant payment
Page 23
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
of $3 million. If all Residential Units that were converted to
condominiums are subsequently leased as rental apartments by Developer
or a successor in interest hereunder, then this Section 5.2.3 shall not apply
to a Program Grant payable in a given Program Year so long as all
Residential Units were used exclusively as rental apartments for the
entirety of the previous calendar year.
5.2.4. Program Cap.
The amount of the Program Cap will increase if the Director issues
a Certificate of Completion for the Level 2 Development or Level 3
Development pursuant to Section 5.1 of this Agreement, as more
specifically, as more specifically set forth in the definition provided in
Section 2 for the term "Program Cap." Once the City has paid Developer
aggregate Program Grants equal to the applicable Program Cap, this
Agreement shall expire. If in any Program Year the amount of a Program
Grant would cause the aggregate Program Grants paid by the City
pursuant to this Agreement to exceed the applicable Program Cap, the
amount of the Program Grant payable in that Program Year shall equal the
difference between the aggregate of all Program Grants paid by the City as
of the previous Program Year and the Program Cap, and this Agreement
shall expire automatically upon payment of such Program Grant.
5.2.5. Deadline for Payments and Source of Funds.
The first Program Grant payable hereunder (in other words, the
Program Grant payable for Program Year 1) shall be paid by the City on
or before June 1 of (i) the Second Operating Year or (ii) the First
Operating Year if requested by Developer in writing and the City, taking
into consideration its current fiscal year budget and following fiscal year
budget planning, provides Developer with written consent to such request.
Each subsequent annual Program Grant payment will be made by the City
to Developer on or before June 1 of the Program Year in which such
payment is due. It is understood and agreed that all Program Grants paid
pursuant to this Agreement shall come from currently available general
revenues of the City and not directly from Development Real Property
Tax Revenues, Development Personal Property Tax Revenues or
Development Sales Tax Revenues. Developer understands and agrees that
any revenues of the City other than those dedicated for payment of a given
annual Program Grant pursuant to this Agreement may be used by the City
for any lawful purpose that the City deems necessary in the carrying out of
its business as a home rule municipality and will not serve as the basis for
calculating the amount of any future Program Grant or other obligation to
Developer.
Page 24
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
6. DEFAULT, TERMINATION AND FAILURE BY DEVELOPER TO MEET_
VARIOUS DEADLINES AND COMMITMENTS.
6.1. Failure to Complete Level 1 of the Development.
If the Level 1 Development does not occur by the Level 1 Completion
Deadline, the City shall have the right to terminate this Agreement by providing
written notice to Developer without further obligation to Developer hereunder. If
the Level 2 Development does not occur by the Level 2 Completion Deadline, this
Agreement shall continue in full force and effect, but the amount of the Program
Source Funds shall be reduced, as more specifically set forth in Section 5.2.1.
The failure of the Level 3 Development to occur by the Level 3 Completion
Deadline shall have no affect on this Agreement or its effectiveness.
6.2. Failure to Pay City Taxes.
An event of default shall occur under this Agreement if any City taxes
owed on the Development Property by Developer or an Affiliate or arising on
account of Developer's or an Affiliate's operations on the Development Property
become delinquent and Developer or the Affiliate does not either pay such taxes
or properly follow the legal procedures for protest and/or contest of any such
taxes. In this event, the City shall notify Developer in writing and Developer
shall have thirty (30) calendar days to cure such default. If the default has not
been fully cured by such time, the City shall have the right to terminate this
Agreement immediately by providing written notice to Developer and shall have
all other rights and remedies that may be available to it under the law or in equity.
6.3. Violations of City Code, State or Federal Law.
An event of default shall occur under this Agreement if any written
citation is issued to Developer or an Affiliate due to the occurrence of a violation
of a material provision of the City Code on the Development Property or on or
within any improvements thereon (including, without limitation, any violation of
the City's Building or Fire Codes and any other City Code violations related to
the environmental condition of the Development Property; the environmental
condition other land or waters which is attributable to operations on the
Development Property; or to matters concerning the public health, safety or
welfare) and such citation is not paid or the recipient of such citation does not
properly follow the legal procedures for protest and/or contest of any such
citation. An event of default shall occur under this Agreement if the City is
notified by a governmental agency or unit with appropriate jurisdiction that
Developer or an Affiliate, or any successor in interest thereto; any third party with
access to any portion of the Development Property owned or operated by
Developer or an Affiliate pursuant to the express or implied permission of
Developer or an Affiliate, or any successor in interest thereto; or the City is in
violation of any material state or federal law, rule or regulation on account of any
Page 25
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
portion of the Development Property owned or operated by Developer or an
Affiliate, or on account of improvements owned or operated by Developer or an
Affiliate or any operations therein on the Development Property (including,
without limitation, any violations related to the environmental condition of any
portion of the Development Property owned or operated by Developer or an
Affiliate; the environmental condition of other land or waters which is attributable
to operations on any portions of the Development Property owned or operated by
Developer or an Affiliate; or to matters concerning the public health, safety or
welfare). Upon the occurrence of any default described by this Section 6.3, the
City shall notify Developer in writing and Developer shall have (i) thirty (30)
calendar days to cure such default or (ii) if Developer has diligently pursued cure
of the default but such default is not reasonably curable within thirty (30) calendar
days, then such amount of time as is reasonably necessary to cure such default. If
the default has not been fully cured by such time, the City shall have the right to
terminate this Agreement immediately by providing written notice to Developer
and shall have all other rights and remedies that may be available to under the law
or in equity.
6.4. Failure to Meet Construction Cost Spending, Supply and Service
Spending and/or Affordable Housing Commitments; Failure to Meet
Employment Goal.
If Developer fails to meet the applicable Fort Worth Construction
Commitment or the applicable M/WBE Construction Commitment, or if
Developer fails to meet the Fort Worth Supply and Service Spending
Commitment or the M/WBE Supply and Service Spending Commitment in any
given year, such event shall not constitute a default hereunder or provide the City
with the right to terminate this Agreement, but, rather, shall only cause the
amount of the Program Grants that the City is required to pay pursuant to this
Agreement to be reduced in accordance with this Agreement. If Developer fails
to meet the Affordable Housing Commitment in any given year, such event shall
not constitute a default hereunder or provide the City with the right to terminate
this Agreement, but, rather, shall only cause the Program Grant payment that
would otherwise have been payable in the following Program Year to be forfeited
or reduced in accordance with this Agreement. If Developer fails to meet the
Employment Goal in any given year, such event shall not constitute a default
hereunder and shall not cause the amount of the Program Grant that the City is
required to pay in the following Program Year to be reduced.
6.5. Failure to Submit Reports.
Without limiting the application of Section 6.6, if Developer fails to
submit any report required by and in accordance with Section 4.8, the City's
obligation to pay any Program Grants at the time, if any, shall be suspended until
Developer has provided all required reports.
Page 26
Amendment No. 2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
6.6. General Breach.
Unless stated elsewhere in this Agreement, Developer shall be in default
under this Agreement if Developer breaches any term or condition of this
Agreement and such breach remains uncured after thirty (30) calendar days
following receipt of written notice from the City referencing this Agreement (or,
if Developer has diligently and continuously attempted to cure following receipt
of such written notice but reasonably requires more than thirty (30) calendar days
to cure, then such additional amount of time as is reasonably necessary to effect
cure, as determined by both parties mutually and in good faith), the City shall
have the right to terminate this Agreement immediately by providing written
notice to Developer.
7. INDEPENDENT CONTRACTOR.
It is expressly understood and agreed that Developer shall operate as an
independent contractor in each and every respect hereunder and not as an agent,
representative or employee of the City. Developer shall have the exclusive right to
control all details and day-to-day operations relative to the Development Property and
any improvements thereon and shall be solely responsible for the acts and omissions of
its officers, agents, servants, employees, contractors, subcontractors, licensees and
invitees. Developer acknowledges that the doctrine of respondeat superior will not apply
as between the City and Developer, its officers, agents, servants, employees, contractors,
subcontractors, licensees, and invitees. Developer further agrees that nothing in this
Agreement will be construed as the creation of a partnership or joint enterprise between
the City and Developer.
8. INDEMNIFICATION.
DEVELOPER, AT NO COST TO THE CITY, AGREES TO DEFEND,
INDEMNIFY AND HOLD THE CITY, ITS OFFICERS, AGENTS SERVANTSAND
EMPLOYEES, HARMLESS AGAINST ANY AND ALL CLAIMS, LAWSUITS,
ACTIONS, COSTS AND EXPENSES OF ANY KIND, INCLUDING, BUT NOT
LIMITED TO, THOSE FOR PROPERTY DAMAGE OR LOSS (INCLUDING
ALLEGED DAMAGE OR LOSS TO DEVELOPER'S BUSINESS AND ANY
RESULTING LOST PROFITS) AND/OR PERSONAL INJURY, INCLUDING
DEATH, THAT MAY RELATE TO, ARISE OUT OF OR BE OCCASIONED BY (i)
DEVELOPER'S BREACH OF ANY OF THE TERMS OR PROVISIONS OF THIS
AGREEMENT OR (ii) ANY NEGLIGENT ACT OR OMISSION OR INTENTIONAL
MISCONDUCT OF DEVELOPER, ITS OFFICERS, AGENTS, ASSOCIATES,
EMPLOYEES, CONTRACTORS (OTHER THAN THE CITY) OR
SUBCONTRACTORS, RELATED TO THE DEVELOPMENT AND ANY
OPERATIONS AND ACTIVITIES THEREON OR OTHERWISE TO THE
PERFORMANCE OF THIS AGREEMENT.
Page 27
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
9. NOTICES.
All written notices called for or required by this Agreement shall be addressed to
the following, or such other party or address as either party designates in writing, by
certified mail, postage prepaid, or by hand delivery:
City: Developer:
City of Fort Worth Carlyle/Cypress West 7th, LP
Attn: City Manager Attn: Lisa Blackburn
1000 Throckmorton 8343 Douglas Ave., Suite 300
Fort Worth, TX 76102 Dallas, TX 75225
with copies to: with a copy to:
the City Attorney and Dee Finley
Economic/Community Development Harris, Finley&Bogle
Director at the same address 777 Main Street, Suite 3600
Fort Worth, TX 76102
10. ASSIGNMENT AND SUCCESSORS.
Developer may at any time assign, transfer or otherwise convey any of its rights
or obligations under this Agreement to an Affiliate that is in good standing to do business
in the State of Texas, as determined by the Texas Secretary of State, without the approval
of the City so long as Developer, the Affiliate and the City first execute an agreement
under which the Affiliate agrees to assume and be bound by all covenants and obligations
of Developer under this Agreement. In addition, Developer may assign its rights and
obligations under this Agreement to a financial institution or other lender for purposes of
granting a security interest in the Development and/or Development Property without the
approval of the City Council, provided that Developer and the financial institution or
other lender first execute a written Consent to Assignment with the City in substantially
the same form as that attached hereto as Exhibit "D", together with such other terms and
conditions as may be agreed by the City, Developer and the financial institution or other
lender with respect to such security interest. Otherwise, Developer may not assign,
transfer or otherwise convey any of its rights or obligations under this Agreement to any
other person or entity without the prior consent of the City Council, which consent shall not
be unreasonably withheld, conditioned on(i)the prior approval of the assignee or successor
and a finding by the City Council that the proposed assignee or successor is financially
capable of meeting the terms and conditions of this Agreement and (ii) prior execution by
the proposed assignee or successor of a written agreement with the City under which the
proposed assignee or successor agrees to assume and be bound by all covenants and
obligations of Developer under this Agreement. Any attempted assignment without the
Page 28
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No. 36633)
City Council's prior consent shall constitute grounds for termination of this Agreement and
the Abatement granted hereunder following ten (10) calendar days of receipt of written
notice from the City to Developer. Any lawful assignee or successor in interest of
Developer of all rights under this Agreement shall be deemed "Developer" for all purposes
under this Agreement.
11. COMPLIANCE WITH LAWS, ORDINANCES, RULES AND
REGULATIONS.
This Agreement will be subject to all applicable federal, state and local laws,
ordinances, rules and regulations, including, but not limited to, all provisions of the
City's Charter and ordinances, as amended. Chapter 2264, Texas Government Code,
relating to restrictions on the use of certain public subsidies (House Bill 1196, 80th
Legislature) does not apply to this Agreement because Developer's application for City
incentives and approval of City Secretary Contract No. 36633, of which this Agreement
is an amendment, occurred prior to September 1, 2007.
12. GOVERNMENTAL POWERS.
It is understood that by execution of this Agreement, the City does not waive or
surrender any of its governmental powers or immunities.
13. NO WAIVER.
The failure of either party to insist upon the performance of any term or provision
of this Agreement or to exercise any right granted hereunder shall not constitute a waiver
of that party's right to insist upon appropriate performance or to assert any such right on
any future occasion.
14. VENUE AND JURISDICTION.
If any action, whether real or asserted, at law or in equity, arises on the basis of
any provision of this Agreement, venue for such action shall lie in state courts located in
Tarrant County, Texas or the United States District Court for the Northern District of
Texas — Fort Worth Division. This Agreement shall be construed in accordance with the
laws of the State of Texas.
Page 29
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No. 36633)
15. SEVERABILITY.
If any provision of this Agreement is held to be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not in any way
be affected or impaired.
16. NO THIRD PARTY RIGHTS.
The provisions and conditions of this Agreement are solely for the benefit of the
City and Developer, and any lawful assign or successor of Developer, and are not
intended to create any rights, contractual or otherwise, to any other person or entity.
17. FORCE MAJEURE.
It is expressly understood and agreed by the parties to this Agreement that if the
performance of any obligations hereunder is delayed by reason of war, civil commotion,
acts of God, strike, inclement weather, shortages or unavailability of labor or materials,
unreasonable delays by the City (based on the then-current workload of the City
department(s) responsible for undertaking the activity in question) in issuing any permits,
consents, or certificates of occupancy or conducting any inspections of or with respect to
the Development, or other circumstances which are reasonably beyond the control of the
party obligated or permitted under the terms of this Agreement to do or perform the same,
regardless of whether any such circumstance is similar to any of those enumerated or not,
the party so obligated or permitted shall be excused from doing or performing the same
during such period of delay, so that the time period applicable to such design or
construction requirement shall be extended for a period of time equal to the period such
party was delayed. Notwithstanding anything to the contrary herein, it is specifically
understood and agreed that Developer's failure to obtain adequate financing to complete
the Development by the Completion Deadline shall not be deemed to be an event of force
majeure and that this Section 16 shall not operate to extend the Completion Deadline in
such an event.
18. INTERPRETATION.
In the event of any dispute over the meaning or application of any provision of
this Agreement, this Agreement shall be interpreted fairly and reasonably, and neither
more strongly for or against any party, regardless of the actual drafter of this Agreement.
Page 30
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
19. CAPTIONS.
Captions and headings used in this Agreement are for reference purposes only and
shall not be deemed a part of this Agreement.
20. MUTUAL ASSISTANCE.
In the event that the City cannot pay Program Grants as provided by this
Agreement on account of a change in applicable law, or in the event that, solely due to a
reduction or reductions by operation of Texas law in the City's real property tax rate,
Tangible Personal Property tax rate or sales tax rates (and not due to a reduction in such
rates unilaterally adopted by the City Council), it appears for the then-foreseeable future
that the Program Grants paid hereunder will be materially less than those that would have
been payable based on the applicable tax rates that were in effect on the Effective Date,
then the City and Developer agree to negotiate in good faith a remedy that preserves the
intent of the parties hereunder as much as reasonably possible, with the understanding
that any amendment to this Agreement must be approved by the City Council.
21. ENTIRETY OF AGREEMENT.
This Agreement, including any exhibits attached hereto and any documents
incorporated herein by reference, contains the entire understanding and agreement
between the City and Developer, and any lawful assign and successor of Developer, as to
the matters contained herein. Any prior or contemporaneous oral or written agreement is
hereby declared null and void to the extent in conflict with any provision of this
Agreement. Notwithstanding anything to the contrary herein, this Agreement shall not be
amended unless executed in writing by both parties and approved by the City Council of
the City in an open meeting held in accordance with Chapter 551 of the Texas
Government Code.
22. COUNTERPARTS.
This Agreement may be executed in multiple counterparts, each of which shall be
considered an original, but all of which shall constitute one instrument.
EXECUTED as of the last date indicated below:
Page 31
Amendment No. 2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No.36633)
CITY OF FORT WORTH: APPROVED AS TO FORM AND
LEGALITY:
B G
Y
Fernando Costa Peter Vaky
Assistant City Manager Deputy City Attorney
Date: M&C: C-22239 07-10-07
If f M&C: C-24722 02-08-11
M&C: C-25123 08-23-11
CARLYLE/CYPRESS WEST 7TH, LP,
a Delaware limited partnership:
By: Carlyle/Cypress ress West 7th
Y Yp GP, LLC,
a Delaware limited liability company, R6nald P. Gonzales,A ty Seuviu +
its General Partner
�,a�v-au�ha
By: Carlyle/Cypress Retail I, L.P., .o IF010p a�,
a Delaware limited partnership, a�o°°°O°rJ00 ,►4�
its Sole Member 9 460 p 0
C1 0 0'{
By: Cypress Equities, LLC, ' a'r�
a Texas limited liability company, ¢� °oo Qlei
its General Partner �a 00o000000 c1
By:
Name,/z
Title:
Date:
OFFICIAL RECORD
Page 32 CITY SECRETARY
Amendment No.2 to Economic Development Program Agreement
between City of Fort Worth and Cypress Equities I,L.P.(CSC No. 36633) FT.If110RT1"1�'1'X
EXHIBITS
"A"—Description and Map Depicting the Development Property
"B"—Depiction of Development
"C" —Calculation of Affordable Housing Requirements
"D"—Form of Consent to Collateral Assignment
Exhibit "B"
Depiction of Development
EXHIBIT A
to
Economic Development Program Agreement
,ots 3-5; ;1-
Texas.
16-20v, Block i i, Van Zandt#i Addition, an addition to the City of Fort Worth,
Texas.
Lots 1-3; Lots 18-20, Block 10, Van Zandt#1 Addition, an addition to the City of Fort Worth,
Texas.
Lots 11-13, Block 9, Van Zandt#1 Addition, an addition to the City of Fort Worth, Texas.
Trs IA, Josiah MC Lynch Survey A 955, Tarrant County, Texas.
Lot 1, Block 1, Brantley Draughon College Addition, an addition to the City of Fort Worth,
Texas.
Tr 1A09, Josiah MC Lynch Survey A 955, Tarrant County, Texas.
Lot 1, Block 2, Woolery Addition, an addition to the City of Fort Worth, Texas
221459v1 Exhibit A,Page 1 of 7
STATE OF TEXAS
COUNTY OF TARRANT
WHEREAS, STATE OF TEXAS
COUNTY OF TARRANT
WHEREAS Carlylo/Cy press West 7t~ is the owner of an that certain tract, parcel or lots of land out of
Lots 8 thru 18, Block 1, VAN ZANDT'S PARK ADDITION, an addition to the City of Fort Worth, Tarrant
County, Texas according to the plat thereof recorded in Volume 204-A, Page 81, Plat Records of Tarrant
County, Texas and that portion of an alley vacated by City Ordinance No. 2252 and recorded in Volume
1715, Page 594, Deed of Records, Tarrant County, Texas and described by deeds recorded in Volume
14253, page 2i 4, Volume 10841, Page 2335, Deed Records of Tarrant County, Texas and more
particularly described as follows:
BEGINNING at a point for corner that is the intersection of the west right-of-way line of Norwood Street
with the south right-of-way line of West 7th Street; and having Texas Coordinate System, 1983-2003
datum, North Central Zone of x=2318873.09 and y=6958063.31 feet,
THENCE: with the west right-of-way line of Norwood Street, S 0°11'57"W. a distance of 276.19 feet to a
point for corner at the intersection of the north right-of-way line of Crockett Street;
THENCE: with the north right-of-way line of Crockett Street, N 89°4654" W, a distance of 422.66 feet to
a five-eights inch iron rod found in the southeast right-of-way line of University Drive as described by
deed recorded in Volume 1276, Page 82, Deed Records of Tarrant County, Texas; and having Texas
Coordinate System, 1983-2003 datum, North Central Zone Coordinate of x= 2318449.48 and y=
6957786.73 feet;
THENCE: with the southeast right-o,`--way line of University Drive described by the deed recorded in
Volume 1276, Page 82, Deed of Records, Tarrant County, Texas, N 24°21'04" E, a distance of 151.10
feet to a one-half inch iron rod found in the center of a vacated easement described by deed recorded in
Volume 1715, Page 594, Deed of Records, Tarrant County, Texas and in the south line of a tract
described by deed recorded in County Clerks File No. D202316167, Deed of Records, Tarrant County,
Texas;
THENCE: leaving the said southeast right-of-way of University Drive, and with the center of the vacated
alley and the said common line, S 89°4849"E, a distance of 261.35 feet to a five-eights inch pipe found
for comer,
THENCE: leaving the said vacated alley centerline, N 0°11'57"E, a distance of 138.15 feet to a point for
corner in the south right-of-way line of West 7th Street and the common corners of Lots 7 and 8, Block 1,
VAN ZANDT'S PARK ADDITION;
THENCE: with the south right-of-way line of West 7th Street, S 89°4654"E, a distance of 99.48 feet to
the place of beginning and containing 1.557 acres of land more or less as surveyed by John hall jr rpls
#1970 during the month of May and June 2007. Bearings, Distances and Coordinates shown hereon are
grid per the Texas Coordinate System. To obtain surface distances, multiply by 1.00011364 the
distances shown. See TNRC5200a.
221459v1 Exhibit A,Page 2 of 7
STATE OF TEXAS
COUNTY OF TARRANT
WHEREAS, Carlyle/Cypress West 7th LLC is the owner of all that certain tract, parcel or lots of land out
of Lot 1R Block 2, VAN ZANDT'S PARK ADDITION, an addition to the City of Fort Worth, Tarrant
County, Texas according to the revised plat thereof recorded in Cabinet B, Slide 2260, Plat Records of
Tarrant County, Texas and that portion of an, alley Vacated by City Ordinance No. 14678 and further
described as Tract 9 by deed recorded in County Clerks file No. D207022431, Deed Records of Tarrant
County, Texas and more particularly described as follows:
BEGINNING at a point for corner that is the intersection of the west right-of-way line of Currie Street with
the south right-of-way line of West 7th Street, and having Texas Coordinate System, 1983-2003 datum,
North Central Texas Zone of x=2318933.09 and y=6958063.08 feet;
THENCE: with the west right-of-way line of Currie Street, S 0 012'22" W, a distance of 276.19 feet to a
point for corner at the intersection of the north right-of-way line of Crockett Street;
THENCE: with the north right-of-way line of Crockett Street, N 89 04654" W, a distance of 500.31 feet to
a point for corner in the east right-of-way line of Norwood Street; and having Texas Coordinate System;
1983-2003 datum, North Central Zone Coordinate of x= 2319432.43 and y= 6957784.99 feet;
THENCE: with the east right-of-way line of Norwood Street, N 0111'57"E, a distance of 276.19 feet to a
point for corner in the south right-of-way of West 7th Street;
THENCE: with the south right-of-way line of West 7th Street, S 89°4654"E, a distance of 500.34 feet to
the place of beginning and containing 3.173 acres of land more or less as surveyed by John nall jr rpls
#1970 during the month of May and June 2007. Bearings, Distances and Coordinates shown hereon are
grid per the Texas Coordinate System. To obtain surface distances, multiply by 1.00011364 the
distances shown. See TNRC5200a. Areas shown are surface.
221459vl Exhibit A,Page 3 of 7
STATE OF TEXAS
COUNTY OF TARRANT
WHEREAS, Carlyle/Cypress West 7th LLC is the owner of all that certain tract, parcel or lots of land out
of Lots 1R Block 3, VAN ZANDTS PARK ADDITION, an addition to the City of Fort Worth, Tarrant
County, Texas according to the revised plat thereof recorded in Cabinet B, Slide 2259, Plat Records of
Tarrant County, Texas and that portinn of an alley vacated by City Ordinance No. 14678 and further
described by deeds recorded in County Clerks file No. D207022431, and D207066656, Deed Records of
Tarrant County, Texas and more particularly described as follows:
BEGINNING at a point for corner that is the intersection of the east right-of-way line of Currie Street with
the south right-of-way line of West 7th Street;and having Texas Coordinate System, 1983-2003 datum,
North Central Texas Zone of x=2319493.42 and y=6958060.95 feet;
THENCE: with the east right-of-way line of Currie Street, S 0 012'22"W, a distance of 276.19 feet to a
point for corner at the intersection of the north right-of-way line of Crockett Street,
THENCE: with the north right-of-way line of Crockett Street, S 89°4654"E, a distance of 500.31 feet to
a point for corner in the west right-of-way line of Foch Street; and having Texas Coordinate System,
1983-2003 datum, North Central Zone Coordinate of x= 2319992.97 and y= 6957782.85 feet;
THENCE: with the west right-of-way line of Foch Street, N 0 01336"E, a distance of 276.19 feet to a point
for corner in the south right-of-way of West 7th Street,
THENCE: with the south right-of-way line of West 7th Street, N 89°4654"W, a distance of 500.65 feet to
the place of beginning and containing 3.173 acres of land more or less as surveyed by john pall jr rols
#1970 during the month of May and June 2007. Bearings, Distances and Coordinates shown hereon are
grid per the Texas Coordinate System. . To obtain surface distances, multiply by 1.00011364 the
distances shown. See TNRC5200a. Areas shown are surface.
221459v1 Exhibit A,Page 4 of 7
STATE OF TEXAS
COUNTY OF TARRANT
WHEREAS, Carlyle/Cypress West 7th LLC is the owner of all those certain tract, parcel or lots of land
known as Lots I thru 7, Block 8, VAN ZANDT'S PARK ADDITION, an addition to the City of Fort Worth,
Tarrant County, Texas according to the plat thereof recorded in Volume 204-A, Page 81, Plat Records of
Tarrant County, Texas and described by deeds recorded in County Clerks file No. 0207022431, Deed
Records of Tarrant County, Texas and more particularly described as follows:
BEGINNING at a point for corner that is the intersection of the east right-of-way line of Currie Street with
the south right-of-way line of Crockett Street, and having Texas Coordinate System, 1983-2003 datum,
North Central Texas Zone of x=2319492.21 and y=6957724.77 feet;
THENCE: with the south right-of-way line of Crockett Street, S 89°46'S4"E, a distance of 350.37 feet to a
point for corner at the northwest corner of Lot 8, Block 8;
THENCE: leaving the south right-of-way line of Crockett Street and with the west line of Lot 8, S 0°
13'092" W, a distance of 130.05 feet to a point for corner in the north right-of-way line of an alley, and
having Texas Coordinate System, 1983-2003 datum, North Central Texas Zone of x=2319842.08 and
y=6957593.38 feet;
THENCE: with the north alley right-of-way line, N 89"4654" W, a distance of 350.34 feet to a point for
corner in the east line of right-of-way line of Currie Street;
THENCE:with the east right-of-way line of Currie Street, N 0 012'22"E, a distance of 130.05 feet to the
place of beginning and containing 1.055 acres of land more or less as surveyed by John pall jr rpls#1970
during the month of May and June 2007. Bearings, Distances and Coordinates shown hereon are grid
per the Texas Coordinate System. See TNRC5200a. Areas shown,are surface.
221459v1 Exhibit A,Page 5 of 7
STATE OF TEXAS
COUNTY OF TARRANT
WHEREAS, Carlyle/Cypress West 7th LLC is the owner of all that certain tract, parcel or lots of land that
are Lots 1 thru 10 and Lots 13 thru 20, Block 9, VAN ZANDT'S PARK ADDITION, an addition to the
City of Fort Worth, Tarrant County, Texas according to the plat thereof recorded in Volume 204A, Page
81, Plat Records of Tarrant County Texas and that portion of an alley vacated by City Ordinance No.
yyyyy and recorded in Volume xxxx, Page aaa, Deed of Records, Tarrant County, Texas and described
as Tracts 1,11,12,13 by deed recorded in County Clerks file No. D207022431, D207052226, and
D204241606, Deed Records of Tarrant County, Texas and more particularly described as follows:
BEGINNING at a point for corner that is the intersection of the east right-of-way line of Norwood Street
with the south right-of-way line of Crockett Street, and having Texas Coordinate System, 1983-2003
datum, North Central Texas Zone of x=2318931.92 and y=6957726.92 feet;
THENCE: with the north right-of-way line of Crockett Street, S 89 04654"E, a distance of 500.30 feet to a
point for corner in the west right-of-way line of Currie Street;
THENCE: with the west right-of-way line of Currie Street, S 0 012' 22" W, a distance of 130.05 feet to a
point for corner in the north right-of-way of an alley in Block 9; and having Texas Coordinate System,
1983-2003 datum, North Central Zone Coordinate of x=2319431.56 and y= 6957578.87 feet;
THENCE: with the said north alley right-of-way line, N89 04654" W, a distance of 100.06 feet to a point
for corner, at the common corners of Lots 8 and 9, Block 9;
THENCE:leaving the said alley right-of-way line, S 0 01222" W, a distance of 146.05 feet to a point for
corner at the common corners of Lots 12 and 13, Block 9 and in the north right-of-way line of Morton
Street;
THENCE: with the north right-of-way line of Morton Street, N 89°4652" W, a distance of 400.22 feet to
the intersection of the east line of Norwood Street;
THENCE: with the said east right-of-way line of Norwood Street, N 0 011'57"E, a distance of 276.10 feet
to the place of beginning and containing 2.836 acres of land more or less as surveyed by john nail jr rols
#1970 during the month of May and June 2007. Bearings, Distances and Coordinates shown hereon are
grid per the Texas Coordinate System. To obtain surface distances, multiply by 1.00011364 the
distances shown. See TNRC5200a. Areas shown are surface.
221459v1 Exhibit A,Page 6 of 7
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i Ca-)Y)e/Cypress West 71' !
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EXHIBIT A, Page 7 of 7
e�-
Exhibit"B"
Depiction of Development
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Exhibit "C"
Calculation of Affordable Housing Requirements
2007 HOME PROGRAM RENT LIMITS AND
2007 INCOME LIMITS FOR THE
FORT WORTH-ARLINGTON,TX HUD METRO FMR AREA
Calculation of Affordable Housing Requirements
)PERSON 2 PERSON 3 PWON 4 PERSON 5 PERSON 6 PERSON 7 PERSON I PERSON{
Fort Worth-Arlin>;otn,TX HUD Metro FMR
30%LIMITS $13,950 $15,950 $17,950 .619,950- $21,550 $23,150 S24,7550 $26,350
L VERY LOW INCOME $23,300 $26,600 $29,950 $33,250 $35,900 $38,550 $41,250 $43,900
60%LIMITS $27,960 $31,920 $35,940 $39,900 $43,080 $46,260 $49,500 $52,680
LOW INCOME $37,250 $42,550 $47,900 $53,200 $57,450 $61,700 S65.950 $70,200
Examples:
1) 80% of Median Household Income (LOW INCOME)
1 person
o Income Limit-$35,500
o Rent Limit-
■ $35,500* .3 = $10,650 Total Yearly Maximum
■ $10,650112 = $887.50 Maximum Monthly Rent
2) 60% of Median Household Income (60% LIMITS)
• 1 person
o income Limit-$26,640
o Rent Limit-
■ $26,640 * .3 = $7,992 Total Yearly Maximum
■ $7,992/12= $666 Maximum Monthly Rent
U.S.Department of HUD 032007,Fort R%orth-
ArIington,TX HUD Metro FMR Area
EXHIBIT "C"
FY 2007 Income Limits Documentation System--Summary for Fort Worth-Arlington, T... Page 1 of 2
FY 2007 Income Limits Documentation
System
FY 2007 in-ome Lim tS Summary
Fort Worth Arlington, TX HUD Metro FMR Area
FY 2007 FY 2007
Income Median Income 1 2 3 4 5 6
Limit Inc9 mq Limit Person Person Person Person Person Person
Area Category
l/eM Lover
50°cl $22,200 $25,350 $28,550 $31,700 $34,250 $36,750
Incorne
Limits U J�
Fort Extremely
Worth- Low
Arlington, $60,600 S0° j $13,300 $15,200 $17,100 $19,000 $20,500 $22,050
TX HUD Income
Metro LM-Tts
FMR Area
_LMM
8 a/ $35,500 $40,550 $45,650 $50,700 $54,750 $58,800
Income
Limits
The Fort Worth-Arlington,TX HUD Metro FMR Area contains the following areas: Johnson County,TX; Parker
County,TX;and Tarrant County, TX
Income Limit areas are based on FY 2007 Fair Market Rent(FMR) areas. For a detailed
account of how this area is derived please see our associated FY 2007 Fair Market Rent
documentation system.
Other HUD Metro FMR Areas in the Same MSA
Sefect another FY 2007 HMFA Income Limit area that is a part of the Dallas-Fort Worth-
Arlington, TX MSA
Qallas,TX HUD Metro FMR Area
SSelect FiMFA Jneo' e Li` `�tsA're2='
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3 DII
EXHIBIT "D"
Form of Consent to Collateral Assienment
CONSENT TO ASSIGNMENT
FOR SECURITY PURPOSES OF
ECONOMIC DEVELOPMENT PROGRAM AGREEMENT
BETWEEN CITY OF FORT WORTH AND
CARLYLE/CYPRESS WEST 7TH9 LP
(CITY SECRETARY CONTRACT NO. 366339 AS AMENDED)
This CONSENT TO ASSIGNMENT FOR SECURITY PURPOSES OF
AMENDED AND RESTATED ECONOMIC DEVELOPMENT PROGRAM
AGREEMENT ("Consent") is entered into by and between the CITY OF FORT
WORTH ("City"), a home rule municipal corporation organized under the laws of the
State of Texas; and CARLYLE/CYPRESS WEST 7TH, LP ("Developer"), a Delaware
limited partnership; and ("Lender"),
RECITALS
The City, Developer and Lender hereby agree that the following statements are
true and correct and constitute the basis upon which the parties have entered into this
Consent:
A. The City and Developer previously entered into that certain Amended and
Restated Economic Development Program Agreement, dated as of , 2011
(the "EDPA") pursuant to which the City agreed to pay Developer certain Program
Grants in an amount up to and not to exceed $31,280,000.00 (as more specifically
outlined in the EDPA) in return for Developer's construction of a mixed-use development
located in cultural district of the City, as more specifically outlined in the EDPA (the
"Development"). The EDPA is a public document on file in the City Secretary's Office
as City Secretary Contract No
B. Section 10 of the EDPA allows Developer to assign its rights and
obligations under the EDPA to a financial institution or other lender for purposes of
granting a security interest in the Development and/or Development Property without the
approval of the City Council, provided that Developer and the financial institution or
other lender first execute a written agreement with the City governing the rights and
obligations of the City, Developer, and the financial institution or other lender with
respect to such security interest.
C. Developer wishes to obtain a loan from Lender in order to [state reason
for loan] (the "Loan"). As security for the Loan, certain agreements between Developer
and Lender governing the Loan and dated , including, but not
limited to, that certain Loan Agreement and [list other related documents] (collectively,
the "Loan Documents") require that Developer assign, transfer and convey to Lender all
of Developer's rights, interest in and to the EDPA until such time as Developer has fully
satisfied all duties and obligations set forth in the Loan Documents that are necessary to
discharge Lender's security interest in the EDPA (the "Assignment").
D. The City is willing to consent to this Assignment specifically in
accordance with the terms and conditions of this Consent.
AGREEMENT
1. The City, Developer and Lender hereby agree that the recitals set forth above are
true and correct and form the basis upon which the City has entered into this Consent.
2. The City hereby consents to the Assignment at the request of Developer and
Lender solely for the purpose of Lender's securing the Loan pursuant to and in
accordance with the Loan Documents. Notwithstanding such consent, the City does not
adopt, ratify or approve any of the particular provisions of the Loan Documents and,
unless and to the extent specifically acknowledged by the City in this Consent, does not
grant any right or privilege to Lender or any assignee or successor in interest thereto that
is different from or more extensive than any right or privilege granted to Developer under
the EDPA.
3. In the event that the City is required by the EDPA to provide any kind of written
notice to Developer, including notice of breach or default by Developer, the City shall
also provide a copy of such written notice to Lender, addressed to the following, or such
other party or address as Lender designates in writing, by certified mail, postage prepaid,
or by hand delivery:
or such other address(es) as Lender may advise City from time to time.
4. If Developer fails to cure any default under the EDPA, the City agrees that
Lender, its agents or designees shall have an additional thirty (30) calendar days or such
greater time as may specifically be provided under the EDPA—to perform any of the
obligations or requirements of Developer imposed by the EDPA and that the City will
accept Lender's performance of the same as if Developer had performed such obligations
or requirements; provided, however, that in the event such default cannot be cured within
such time, Lender, its agents or designees, shall have such additional time as may be
reasonably necessary if within such time period Lender has commenced and is diligently
pursuing the remedies to cure such default, including, without limitation, such time as
may be required for lender to gain possession of Developer's interest in the Developer
propertv pursuant to the terms of the Loan Documents.
5. If at any time Lender wishes to exercise any foreclosure rights under the Loan
Documents, before taking any foreclosure action Lender shall first provide written notice
to the City of such intent (a "Notice"). Lender shall copy Developer on the Notice and
deliver such Notice to Developer by both first class and certified mail return receipt
concurrent with its transmittal of the Notice to the City and represent in the Notice that it
has done so. Notwithstanding anything to the contrary herein, unless Lender enters into a
written agreement with the City to assume and be bound by all covenants and obligations
of Developer under the EDPA, Lender understands and agrees that the City shall not be
bound to pay Lender any Program Grants pursuant to the EDPA. In addition, Lender
understands and agrees that if Lender wishes to sell all or any portion of the Development
Property or improvements thereon to a third party following Lender's exercise of any
foreclosure rights under the Loan Documents, the City shall not be bound to pay such
third party any Program Grants pursuant to the EDPA unless Lender and such third party
comply with the procedure for assignment set forth in Section 10 of the EDPA, including
the obligation of such third party to enter into a written agreement with the City to
assume and be bound by all covenants and obligations of Developer under the EDPA. In
the event that payment of any Program Grants are withheld by the City pursuant to this
Section 5, any rights to receipt of those Program Grants are hereby waived, but the
number and amount(s) of any such Program Grant(s) shall nevertheless be counted for
purposes of calculating the Term of the EDPA, as set forth in Section 3 of the EDPA.
6. In the event of any conflict between this Consent and the EDPA or any of the
Loan Documents, this Consent shall control. In the event of any conflict between this
Consent and any of the Loan Documents, this Consent shall control. In the event of any
conflict between the EDPA and any of the Loan Documents, the EDPA shall control.
7. This Consent may not be amended or modified except by a written agreement
executed by all of the parties hereto. Notwithstanding anything to the contrary in the
Loan Documents, an amendment to any of the Loan Documents shall not constitute an
amendment to this Consent or the EDPA.
S. Once Developer has fully satisfied all duties and obligations set forth in the Loan
Documents that are necessary to discharge Lender's security interest in the EDPA and
such security interest is released, Lender shall provide written notice to the City that
Lender has released such security interest, in which case this Consent shall automatically
terminate.
9. This Consent shall be construed in accordance with the laws of the State of Texas.
Venue for any action arising under the provisions of this Consent shall lie in state courts
located in Tarrant County, Texas or in the United States District Court for the Northern
District of Texas, Fort Worth Division.
10. Capitalized terms used but not specifically defined in this Consent shall have the
meanings ascribed to them in the EDPA.
11. This written instrument contains the entire understanding and agreement between
the City, Developer and Lender as to the matters contained herein. Any prior or
contemporaneous oral or written agreement concerning such matters is hereby declared
null and void to the extent in conflict with this Consent.
12. This Consent shall be effective on the later date as of which all parties have
executed it. This Consent may be executed in any number of duplicate originals and each
duplicate original shall be deemed to be an original. The failure of any party hereto to
execute this Consent, or any counterpart hereof, shall not relieve the other signatories
from their obligations from their obligations hereunder.
EXECUTED as of the last date indicated below:
[SIGNATURES IMMEDIATELY FOLLOW ON NEXT PAGE]
CITY OF FORT WORTH: APPROVED AS TO FORM
AND LEGALITY:
By: By:
Name: Name:
Assistant City Manager Assistant City Attorney
Date: M&C: none required
CARLYLE/CYPRESS WEST 7TH, LP,
a Delaware limited partnership:
By: Carlyle/Cypress West 7th GP, LLC,
a Delaware limited liability company,
its General Partner
By: Carlyle/Cypress Retail I, L.P.,
a Delaware limited partnership,
its Sole Member
By: Cypress Equities, LLC,
a Texas limited liability company,
its General Partner
By:
Name:
Title:
Date:
By:
Name:
Title:
Date:
M&C Review Page 1 of 3
Official site of the City of Fort Worth,Texas
CITY COUNCIL AGENDA FoRTWoRN
COUNCIL ACTION: Approved on 8/23/2011
DATE: 8/23/2011 REFERENCE C-25123 LOG NAME: 17CYPRESSEDPGAMEND2
NO..
CODE: C TYPE: NOW PUBLIC NO
CONSENT HEARING:
SUBJECT: Authorize Execution of Amendment No. 2 to City Secretary Contract No. 36633, Economic
Development Program Agreement with Carlyle/Cypress West Seventh, LP, to Revise
Conditions Necessary for Receipt of Economic Development Grants Associated with the
West 7th Development (COUNCIL DISTRICT 9)
RECOMMENDATION:
It is recommended that the City Council authorize the City Manager to execute Amendment No. 2 to
City Secretary Contract No. 36633, Economic Development Program Agreement with
Carlyle/Cypress West Seventh, LP, to revise conditions necessary for receipt of economic
development grants associated with the West 7th Development, specifically by reducing the
percentage of incentive available, to extend completion deadlines and to amend the levels of
investment required for a particular level of incentive.
DISCUSSION:
On July 31, 2007, the City of Fort Worth entered into an Economic Development Program Agreement
with Carlyle/Cypress West 7th, LP (Carlyle), for the construction of a mixed-use project in the vicinity
of West 7th Street, Crockett Street, Norwood Street and Foch Street (M&C C-22283, City Secretary
Contract No. 36633). The Agreement was amended (Amendment No.1) on February 1, 2011 to allow
collateral assignment of the Agreement (M&C C-24722, City Secretary Contract No. 36633-A1). The
Agreement allows Carlyle to earn annual economic development grants for 15 years in return for
completing a mixed-use project on the site by December 31, 2011. The amount of each annual grant
is capped at 75 percent of increased real and personal property taxes as well as sales taxes
attributable to the site. In addition, the aggregate amount of grants that Carlyle can receive over the
15-year period is dependent on whether Carlyle meets one of three possible levels of investment and
construction defined in the Agreement.
Because of the change in financing requirements associated with the economic downturn, Carlyle
has approached the City staff to ask that the investment levels be broken into specific phases and
that each level have a separate completion deadline associated with it. Specifically, due to the
change in market conditions, Carlyle proposes an amendment to the Agreement to incorporate the
following changes:
http://apps.cfwnet.org/council_packet/mc review.asp?ID=15696&councildate=8/23/2011 11/9/2011
M&C Review Page 2 of 3
Cypress West 7th Chapter 380 EDPA
Current Terms New Terms/Proposed Changes
• Deadline: • Deadline:
— December 31, 2011 — December 31, 2011 (Level 1 Investment)
(for all three levels of investment) — December 31, 2012 (Level 2 Investment)
• Grant Terms: — December 31, 2013 (Level 3 Investment)
— 75% on real, personal and sales • Grant Terms:
tax — 70% on real, personal and sales tax
— 15 year grant — 15 year grant
• Investment Level 1: $158M - • Investment Level 1: $150M - $165M
$178M — 200,000 SF of commercial space
— 200,000 SF of commercial space — 300,000 SF of residential units
— 300,000 SF of residential units • Investment Level 2: $165,000,001 - $190M
— 80,000 SF of office space — 200,000 SF of commercial space
• Investment Level 2: $178,000,001 - — 380,000 SF of residential units
$198M — 80,000 SF of office space
— 200,000 SF of commercial space If Investment Level 2 is not met then the
— 300,000 SF of residential units grant will be reduced to 65%
— 80,000 SF of office space Investment Level 3: $190,000,001 and above
— 80,000 SF of hotel — 200,000 SF of commercial space
• Investment Level 3: $198,000,001 — 460,000 SF of residential units
and above — 100,000 SF of office space
— 200,000 SF of commercial space
— 300,000 SF of residential units
— 180,000 SF of office space
— 80,000 SF of hotel
The change in the overall deadline structure would give Carlyle an opportunity to continue
construction on the site for up to two additional years without locking in the aggregate amount of
economic development grants that it would be eligible to receive under the Agreement.
All other terms of the Agreement will remain the same. The Development is located in COUNCIL
DISTRICT 9.
FISCAL INFORMATION/CERTIFICATION:
The Financial Management Services Director certifies that this action will have no material effect on
City funds.
TO Fund/Account/Centers FROM Fund/Account/Centers
Submitted for City Manager's Office by: Susan Alanis (8180)
Originating Department Head: Jay Chapa (5804)
Additional Information Contact: Robert Sturns (8003)
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=15696&councildate=8/23/2011 11/9/2011
M&C Review Page 3 of 3
ATTACHMENTS
http://apps.cfwnet.org/council_packet/mc review.asp?ID=15696&councildate=8/23/2011 11/9/2011